TORONTO, ON, March 15, 2021 /CNW/ – Summit Industrial Income REIT (“Summit” or the “REIT”) (TSX: SMU.UN) announced today that it has waived conditions and will acquire 100% of a modern 765,145 square foot logistics and office complex well-located in Saint-Laurent, Quebec, a suburb of the Greater Montreal Region. Minutes from Montreal-Trudeau Airport and with excellent access to major highway and railway transportation links, the property contains 534,111 square feet of next-generation logistics space and 231,034 square feet of Class A office space. The property is 100% occupied by two institutional-grade global tenants with a 10.5-year average remaining lease term including 10% rental increases every five years. Summit will pay $183.3 million in cash for the property, well below replacement cost, generating a going-in capitalization rate of approximately 4.5%. Closing is expected in April 2021.
Located in the heart of the Saint-Laurent Industrial Park, this best-in-class logistics space features 37-foot clear ceiling heights, 52 truck-level doors, one drive-in door, 30 trailer parking stalls, electric vehicle charging and sophisticated moveable mezzanine space ideal for e-commerce logistics. The space is occupied by a single tenant, a global e-commerce luxury goods platform operating in more than 150 countries with 9 years remaining on its lease.
The three-storey Class A office building provides a world-class modern environment including ample green space, a sky-lit three-level atrium, gourmet kitchen and underground parking. The office tenant, the world’s largest privately-owned security services company, has a long-term commitment in the space with 14 years remaining on its lease.
Encompassing over 35 acres, the property has a modest 37% site coverage, providing the opportunity for potential future expansion.
“This highly-accretive acquisition, occupied by institutional-grade tenants under long-term leases, significantly enhances our presence in Canada’s second largest industrial market,” commented Dayna Gibbs, Chief Operating Officer. “Looking ahead, the 10% contractual rent increases every five years will enhance returns generated by the property, making a significant contribution to our cash flow going forward.”
The REIT also announced today that it has agreed to sell a non-core 30,411 square foot industrial property in Edmonton, Alberta for $5.0 million, above the REIT’s IFRS book value for the property. Closing of this sale transaction is expected by the end of March 2021.
Summit Industrial Income REIT is an unincorporated open-end trust focused on growing and managing a portfolio of light industrial properties across Canada. Summit’s units are listed on the TSX and trade under the symbol SMU.UN. For more information, please visit our web site at www.summitIIreit.com.
Caution Regarding Forward Looking Information
This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “objective”, “ongoing”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends”, “goal” and similar expressions are intended to identify forward-looking information or statements. More particularly and without limitation, this news release contains forward looking statements and information concerning the goal to build Summit’s property portfolio. The forward-looking statements and information are based on certain key expectations and assumptions made by Summit, including general economic conditions. Although Summit believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because Summit can give no assurance that they will prove to be correct. By its nature, such forward-looking information is subject to various risks and uncertainties, which could cause the actual results and expectations to differ materially from the anticipated results or expectations expressed and given the impact of the COVID-19 pandemic and government measures to contain it, there is inherently more uncertainty associated with the REIT’s assumptions as compared to prior periods. These risks and uncertainties include, but are not limited to, tenant risks, current economic environment, environmental matters, general insured and uninsured risks and Summit being unable to obtain any required financing and approvals. Readers are cautioned not to place undue reliance on this forward-looking information, which is given as of the date hereof, and to not use such forward-looking information for anything other than its intended purpose. Summit undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
SOURCE Summit Industrial Income REIT
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